The former director of the Crow Tribe’s Historic Preservation Office and his son avoided federal prison sentences on Wednesday for convictions in a corruption scheme, but they will have to pay restitution — although the amount is far smaller than what the prosecution claimed.
A third defendant also sentenced Wednesday got probation along with restitution.
And two previously sentenced co-defendants had their restitution amounts reduced in a case that has had four judges and has run for 18 months.
The case involved cultural monitoring work performed by the tribe’s Historic Preservation Office, when it was directed by Dale Old Horn, 68.
The case centered on a double-billing scheme in which office monitors, who were hired to oversee projects by companies on Crow lands, were paid directly by the companies and by the tribe.
Federal prosecutors alleged the scheme, devised by Dale Old Horn, diverted more than $500,000 from the tribe and into the pockets of Old Horn’s family and others.
But in a dispute over restitution, U.S. District Judge Susan Watters ultimately ruled the loss to the tribe was $48,370.
Old Horn, his son, Allen Joseph Old Horn, 41, who was a supervisor, and Shawn Talking Eagle Danforth, 38, a monitor, all were convicted last August by a jury of conspiracy, corruption and theft charges. The panel additionally convicted Allen Old Horn of extortion and income tax fraud.
Four other defendants pleaded guilty earlier to various charges. Three defendants received five years probation, while the fourth, Martin Old Horn, the grandson of Dale Old Horn, was sentenced to six months in prison after pleading guilty to mail fraud and student aid fraud.
Watters sentenced Dale Old Horn and Allen Old Horn each to time served of seven days and ordered three years of supervised release, including four months of electronically monitored home detention.
She also imposed $48,370 restitution and held the Old Horns individually and jointly responsible for paying the amount.
In addition, Watters ordered Allen Old Horn to pay $14,973 restitution to the IRS.
Watters called Dale Old Horn and Allen Old Horn “the masterminds” of the scheme and said that was her reason for ordering full restitution. “You were the brains behind it,” she told Dale Old Horn.
Watters sentenced Danforth to five years probation and ordered $8,560
restitution, which Danforth is jointly responsible for paying.
Danforth, the judge said, had a lesser role and when he questioned the double billing scheme, he was told not to worry about it.
The judge noted that none of the three defendants had criminal records and that their actions appeared to be aberrations.
All three defendants faced prison time under the guidelines, but the judge opted for shorter sentences. Dale Old Horn faced 30 months to 37 months; Allen Old Horn faced 27 months to 33 months while Danforth faced four months to 10 months.
Defense attorneys all sought probationary sentences. Assistant U.S. Attorney Kris McLean asked for guideline terms and objected to the guideline departures.
No one spoke on behalf of the Crow Tribe.
Crow Chairman Darrin Old Coyote — nephew of Dale Old Horn — sent tribal secretary Alvin Not Afraid to a hearing in February in which Not Afraid said the tribe’s losses were not as significant as prosecutors maintained.
Dale Old Horn asked the judge to consider his nearly 45-year marriage to his wife, who has cancer and needs his support. He said he also is raising his two grandchildren and is the family’s sole supporter.
“I am proud to be a Crow Indian,” he said, noting his work on teaching cultural traditions and work to address drug and alcohol abuse.
Dale Old Horn, the family patriarch, directed the preservation office from 2005 through 2011, overseeing the protection of the Crow’s cultural, archaeological and historic resources.
The prosecution said Old Horn arranged for companies including NorthWestern Energy and ConocoPhillips to make direct payments to the monitors — who included family members — instead of sending payment to the tribe’s finance office. Some monitors also were paid as tribal employees.
Much of the money paid through the scheme came from companies that were charged inflated rates for monitoring work, the prosecution said.
Among sites monitored was a 2,000-year-old bison kill site that the U.S. Attorney’s Office said was irreparably damaged after excavation work approved by Old Horn in 2011.
Prosecutors acknowledged in court records that they dropped the ball in the case. Assistant U.S. Attorney Carl Rostad said if the government had included the fraud perpetrated against the companies hiring the monitors, it would have been able to bring additional charges and seek more restitution.
Defense attorney Jay Lansing, who represented Allen Old Horn, criticized prosecutors for offering a “moving target” as its legal theories changed.
And Matthew Wald, who represented Dale Old Horn, said his client did not personally pocket any money through the alleged scheme. “The government’s theory when the case started was, ‘Mr. Old Horn, you took $500,000. Eat it,’” he said. But “it was wages paid by the companies for work done. It simply makes this case different,” he said.
Watters also corrected and reduced restitution previously imposed on two other defendants to amounts specific to their roles with the tribe’s loss of $48,370.
Watters ordered Mark James Denny to pay $1,408 restitution, rather than $73,045 restitution; and for Larkin Troy Chandler to pay $5,280 restitution instead of $44,546. Chandler already has paid $1,950, while Denny has paid $3,766. Both Chandler and Denny were sentenced to five years probation.
The judge told Denny’s attorney, Marvin McCann, to file a motion to address the restitution overpayment and his request for Denny to be released from probation.